Medical debt harms people in different ways. It can lead them to seek payday loans, take money out of their retirement accounts, or delay medical care.
For people who give birth, financial worries can affect major decisions about what their family ultimately looks like.
A Penn State study of 2,169 first-time Pennsylvania moms with private insurance found 8.3% had childbirth bills sent to collections. These women were less likely to have a second child in the following two years compared to those who didn’t have debt in collections, it found.
“I have patients all the time who will tell me, ‘I had no idea. I have insurance. I have good insurance,’” Sarah Horvath, an OB-GYN who practices in central Pennsylvania, said of surprise medical bills. “‘I had no idea I was gonna get a bill for $4,000, $8,000, $15,000.’”
Pennsylvania does not track who holds medical debt or the amount, multiple state agencies told Spotlight PA. But a national 2022 KFF study of women with private insurance found that average out-of-pocket payments for pregnancy, childbirth, and postpartum care totaled $2,854.
"It can really set people back,” Cynthia Cox, a co-author of the study, said of these costs. “It's more than a lot of people have in their savings.”
A bill under consideration in the state House would establish a program within the Pennsylvania health department to pay off medical debt balances that have been sent to collections. Pennsylvanians unable to pay the cost of care even after insurance or financial assistance would be eligible for the relief.
State Rep. Arvind Venkat (D., Allegheny), an emergency medicine physician and the bill’s primary sponsor, told Spotlight PA the legislation could help address worrying maternal health trends in Pennsylvania. He cited research showing a direct correlation between medical debt and poor health outcomes, and argued rural areas would especially benefit.
"Medical debt in collections is largely concentrated in rural Pennsylvania," he said. "So you have a coming together of all of these issues that are really, really harmful to our fellow Pennsylvanians."
Costs can also impact personal health decisions during pregnancy, said Horvath, recalling a recent patient who was hospitalized for a complication and decided to forgo some lab tests to limit costs.
"She was being very thoughtful about prioritizing which care was most necessary," said Horvath.
Patients always have to calculate risks versus benefits when making these decisions, said Horvath. Sometimes they are waiting to be approved by Medicaid or for their insurance to kick in. But delayed care can lead to medical complications and result in higher bills.
More than a third of new parents in the commonwealth are protected from childbirth and pregnancy-related medical debt because they're insured through Medicaid. The public health insurance program for low-income people covers all necessary medical services for pregnancy, delivery, and one year of postpartum care, per state law.
Eligibility is based on income and household size: A pregnant Pennsylvanian who is single can earn up to $33,648 a year and qualify for coverage. But new parents who earn just beyond the Medicaid threshold are more likely to bring home a sizable medical bill when they leave the hospital.
Horvath warned that financial stressors contribute to postpartum depression, a disorder that affects 1 in 8 women who have recently given birth. A parent with the diagnosis might have insomnia, anxiety, and feelings of shame or worthlessness. This can result in them struggling to bond with and care for their baby and themselves.
In addition to relieving debt, Venkat’s bill would also make hospital charity care policies more accessible and transparent. Nonprofit health systems are legally mandated to provide financial assistance to patients due to their tax-exempt status. But recent studies have argued that these organizations don’t provide enough charity care to warrant this.
The bill would require all hospitals to use a uniform financial assistance application and a one-page template to summarize eligibility. These forms would be written by the state health department in sixth-grade English and translated into other commonly spoken languages, like Spanish.
Hospitals would also have to disclose the availability of charity care on their websites and in other materials.
Antoinette Kraus, of Philadelphia-based nonprofit Pennsylvania Health Access Network, said these changes would make a big difference, as charity care policies are often opaque and the current system is chaotic. Every health system has its own application and income guidelines.
And as the Consumer Financial Protection Bureau reported in 2022, some hospitals don’t tell patients they might be eligible.
“So you may have a bill, and you might be able to get financial assistance from the hospital. You just have no way of knowing,” said Kraus.
Kraus’ organization runs a consumer assistance program that helps people navigate unpaid medical bills or apply for charity care. She often hears from parents who have a pregnancy or childbirth-related bill they can't pay.
Venkat told Spotlight PA that he doesn't think hospitals purposely shirk responsibility, arguing that the system as a whole is broken and that legislation is necessary to make access to financial assistance equitable statewide.
Citing the bill’s Democratic and Republican co-sponsors, Venkat said he’s hopeful about the legislation’s prospects. In 2023, a previous version of the bill passed out of the state House with bipartisan support but was not picked up by the GOP-controlled Senate.
The current version does not prescribe a dollar amount for relief, so lawmakers would have to separately agree on an appropriation. Last year, Democratic Gov. Josh Shapiro proposed allocating $4 million to the program, but there was no mention of it in this year's budget address.
Venkat anticipates his latest proposal will go through some changes, and expects the idea of providing taxpayer-funded relief to be a sticking point, because debt doesn't affect all Pennsylvanians.
Legislating is “the art of the possible,” said Venkat. But he argued the transparency provisions of his bill would help people, including new parents, avoid medical bills in the first place.
The Hospital and Healthsystem Association of Pennsylvania, the powerful advocacy arm for the state’s hospitals, did not directly comment on Venkat’s bill. But it told Spotlight PA via email that Pennsylvania hospitals are committed to helping patients make care affordable.
“This includes working hard to make sure that charity care programs are highly visible and accessible to patients and their families,” said the organization. “Hospital financial offices work directly with patients and families to understand coverage and financial responsibility and to help them access charity care and public programs.”
Caregivers and advocates for families are enthusiastic about Venkat’s proposal. Karen Showalter, an advocacy director for the Pennsylvania chapter of the nonprofit MomsRising, said the legislation would create more billing transparency and lessen the medical costs of childbirth and pregnancy.
"The birth of a new child should be an exciting time, but because lawmakers haven't invested in the care policies working families need, it's also a vulnerable time," Showalter told Spotlight PA in an email.
The American College of Obstetricians and Gynecologists has not come out in support of Venkat’s bill. But Horvath, who is legislative vice chair of the organization’s Pennsylvania chapter, said it is looking at the proposal with interest.
Welcoming a new baby should be a time of joy, said Horvath. But too many of her patients are surprised that their health insurance doesn't cover the complete costs of pregnancy and childbirth.
This unexpected burden is especially disruptive postpartum, Horvath noted. Parents should be resting and bonding with their newborns during this critical period, she said — not sitting on the phone with a hospital trying to set up a payment plan.
Update, March 11: This story has been updated to include a comment from the Hospital and Healthsystem Association of Pennsylvania.
